IS NETWORK MARKETING A PYRAMID OR A PONZI SCHEME OR A LEGITIMATE HOME BUSINESS OPPORTUNITY?
In the field of investment or securities fraud, the phrase “Ponzi scheme” refers to a real person and event. Charles Ponzi was a real person who committed a shocking crime. According to this article that I am presenting “Schemes’ Ponzi ” that was available on the website of the United States Securities and Exchange Commission, Charles Ponzi elevated more than one million dollars in three hours in 1921. The people who gave him money they made an investment with a promise that they would get a 50 percent return in 90 days, in other words, they would give him $ 1,000 and recover $ 1,500 in three months.
That sounds too good to be true even today, however, there are websites that boast checks of $ 16,000 on your face while a person tells you how easy it was and that you can do it too. A good rule of thumb when considering an investment is “if it sounds too good to be true, it probably is.” Another good rule of thumb is never to spend money that you cannot afford to lose. That said, what establishes an investment as a “Ponzi Scheme”?
Not being a lawyer, my explanation will be too simplified. If you are being lied to or even PROMISED a return (which nobody can do), then qualify. Even an employer cannot guarantee your payment. Fortunately, we have agencies that have intervened and require that disclaimers be placed at the bottom of any website that submits income claims. This does not prevent the video or visual presentation from showing profits or prompting you to pay the money to discover how the guy did it. He is selling his master plan. Do you really want to know? Did you read the disclaimer? Looking for a money back guarantee?
You can pay for the “secrets” just to learn that the way to earn that kind of money is to do to others what he just did to you. That can add insult to the injury. Now you may think that all promoted internet sales launches lead to scam and shame. This is only partially true. Applying that to the entire Internet Network Marketing would be a fallacy. Before ruling out every opportunity, a better option might be the ability to recognize a genuine offer.
Here are some tips. First, a true internet marketer will offer something of value at a low price or free and will give you a guarantee. He knows he has to build trust. You should be able to do a search in your name or in the name of the company and be able to find information established in several places. When calling, someone should answer or at least call back. Contact information must be readily available. The payment method must include accredited Internet services such as Pay Pal or Alert Pay instead of requesting only your credit card information. These paid services can be verified to see if, without knowing it, you subscribed to a subscription instead of a fixed charge. Never give your bank information. Check the company with the BBB and see if it appears there or if there have been complaints. See if the person is on Facebook, Twitter, Myspace and how many friends, followers or subscribers they have. Do you have testimonials and recommendations?
This works both ways. If you are an online seller, keep in mind that those are the things that build trust. The more money you ask the person to deliver, the more reliable and reliable you will have to be. Enrolling someone in a product or service is not enough. You should always follow up to make sure they are satisfied and get what they paid for.
What about a “pyramid”? We will clarify that below. This is when the money reaches the top from the lower levels like a chain letter or “give five people five dollars and then have them get five people to give you five dollars and you’ll end up with $ 25,000 in a couple of months.” What makes it an illegal scheme is that you finally hit bottom and there is no roll up. But this also exists: no product or service was exchanged. This is not marketing. It is a scheme. Having a pyramid shape makes it illegal.
Most large companies have a pyramid formation. There are few or one at the top and many people at the bottom. Those responsible receive the highest payment and the lowest levels are those who pay less. What makes the difference is if they pay what they are worth, the potential advance to the highest ranks and the ability to contribute to the group in general.
In fact, Internet marketing not only allows a person to gain value, contribute to the company (the group) and move up the ranks, but REQUIRES it. Some famous entrepreneurs have recognized the value of a valid and well-established network marketing team and call it the business of the future. Being old enough to remember how businesses were half a century ago, I see the similarities. Small businesses relied on the loyalty of their employees and customers. To obtain this, they provided a series of incentives and production bonuses. This is becoming the norm in internet marketing. Smart plans are melting and international marketing businesses are taking their place.
New Internet regulations, such as earnings waivers, have reduced much of the scam schemes that were once there. In addition, time has shown that people MAKE a legitimate income using the Internet with an international reach of consumers. Old-school marketing with seminars, home parties and home business meetings are losing popularity compared to automated systems that run even if it isn’t there. Internet is faster, easier and more efficient.
It is the separate and impossible aspect of tracking that makes scams possible. If you are the network marketer or the consumer, the points mentioned above are the ingredients that make online marketing, especially network marketing, a more rewarding experience.